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Sri Lanka Equity Forum » Stock Market Talk » Orient Finance PLC- possible future star

Orient Finance PLC- possible future star

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1 Orient Finance PLC- possible future star on Mon Sep 05, 2016 11:42 pm

EquityChamp

avatar
Moderator
Pursuant to the amalgamation with Bartleet Finance, Orient Finance has shown clear signs of growth both in asset base and profitability. The company recorded an income of Rs741mn for Q1 of FY 16/17 with PAT of 73 mn.

The company is seen recording an interest yield of around 20% on its loan portfolio for the last couple of quarters which can be termed as bit below the industry average which is around 22% at the moment. Though the interest yield is somewhat below the industry the company has managed to record a loan book growth of 2.6% during quarter ending Jan-Mar 2016 with a further growth of 4.8% during the quarter ending Apr-Jun 2016.

Based on the current trend we can project their earnings as tabulated below. The earnings of 2015/16 were boosted by one off differed tax reversal hence a decline of earnings YoY is not a surprise though the core business operation growth looks promising.
Rs mn14/1515/1616/17F
Income   1,363    2,363    3,394
PBT
           4
      296       397
PAT            4       607       333
Accordingly the estimated EPS for 16/17 will be Rs2.25. With the current market price of Rs16.50 the stock is trading at a PE of 7.3x and PBV of 1x based on forecasted earnings.

The company doesn't declare any dividend for the last three years owing to low profitability. However with improved performance there is a possibility that shareholders may receive a dividend around Rs1.30 for the FY 16/17.

According to shareholders' list close to 145mn shares of issued capital is with top 5 shareholders and therefore this stock is very illiquid too. Aided by this illiquidity and with another bit of increased aggression in business operations with a view to increase the interest yield would turnout this company to be an absolute profitable venture within a two to three years time similar to Union Bank.

Finally my conclusion is if an investor wants to participate to a future winning business and with an holding capacity of one to two years then Orient Finance will be an ideal investment vessel with lower risk threshold. Holding 5000 to 10000 shares will not be in vain for a mid term investor.

Thanks

2 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 6:19 am

troy

avatar
Moderator
All good but I feel bad whether its gonna be another disappointing share like VFIN or HDFC.

Anyway as I know about their business, Orient Finance is a blood sucker. Earn high interest from their customers and pay high interest for their corporate investors (they borrow at very high rates through ABSs). Not sure how long they can continue this model.

3 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 6:58 am

EquityChamp

avatar
Moderator
@troy wrote:All good but I feel bad whether its gonna be another disappointing share like VFIN or HDFC.

Anyway as I know about their business, Orient Finance is a blood sucker. Earn high interest from their customers and pay high interest for their corporate investors (they borrow at very high rates through ABSs). Not sure how long they can continue this model.

According to their published financials Orient Finance's interest yield is little lower than industry average. So how can we see they are charging higher rates from customers?

4 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 7:22 am

troy

avatar
Moderator
EC pls let me know the industry yield and Orient yield...

5 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 8:10 am

EquityChamp

avatar
Moderator
Haven't you read what I have written above properly?

6 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 9:41 am

Teller

avatar
Moderator
See their loan book growth. It's an amazing growth. So we can hope a good interest income for them.
IF they can break 17/ barrier , this share will touch 20 levels.

7 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 10:01 am

fireshelter

avatar
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
really Very Happy Very Happy Very Happy

8 Re: Orient Finance PLC- possible future star on Tue Sep 06, 2016 10:19 am

Gainer

avatar
Associate Director - Equity Analytics
Associate Director - Equity Analytics
BFN Collection for Maga Bull Run cheers cheers cheers

9 This week ... Run on Mon Sep 12, 2016 7:59 am

rajico1981


Stock Trader
BFN.N ..........This Week Run

10 Re: Orient Finance PLC- possible future star on Tue Sep 13, 2016 1:31 am

Teller

avatar
Moderator
Wait till next support creation..

11 Re: Orient Finance PLC- possible future star on Wed Sep 14, 2016 4:11 pm

fireshelter

avatar
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
remaining Sell  Quantity will absorb soon

12 Re: Orient Finance PLC- possible future star on Fri Sep 16, 2016 1:15 pm

pfxavier


Senior Equity Analytic
Senior Equity Analytic
It will come down to 16.00 - 16.20 before next run start. I am waiting to collect more.

13 Re: Orient Finance PLC- possible future star on Sat Sep 17, 2016 6:42 am

EquityChamp

avatar
Moderator
Orient Finance as well as UBC are great value counters at current price levels for a minimum of two year period investment. It is risky if you select them as vessels for short term gains.

14 Re: Orient Finance PLC- possible future star on Sat Sep 17, 2016 6:58 pm

Teller

avatar
Moderator
BFN come to 15.70 levels & UBC earnings and progress is very slow compare to its Industry si price decline can be expected.

15 Re: Orient Finance PLC- possible future star on Wed Oct 19, 2016 10:40 am

visvajith


Equity Analytic
Equity Analytic
@EquityChamp wrote:Pursuant to the amalgamation with Bartleet Finance, Orient Finance has shown clear signs of growth both in asset base and profitability. The company recorded an income of Rs741mn for Q1 of FY 16/17 with PAT of 73 mn.

The company is seen recording an interest yield of around 20% on its loan portfolio for the last couple of quarters which can be termed as bit below the industry average which is around 22% at the moment. Though the interest yield is somewhat below the industry the company has managed to record a loan book growth of 2.6% during quarter ending Jan-Mar 2016 with a further growth of 4.8% during the quarter ending Apr-Jun 2016.

Based on the current trend we can project their earnings as tabulated below. The earnings of 2015/16 were boosted by one off differed tax reversal hence a decline of earnings YoY is not a surprise though the core business operation growth looks promising.
Rs mn14/1515/1616/17F
Income   1,363    2,363    3,394
PBT
           4
      296       397
PAT            4       607       333
Accordingly the estimated EPS for 16/17 will be Rs2.25. With the current market price of Rs16.50 the stock is trading at a PE of 7.3x and PBV of 1x based on forecasted earnings.

The company doesn't declare any dividend for the last three years owing to low profitability. However with improved performance there is a possibility that shareholders may receive a dividend around Rs1.30 for the FY 16/17.

According to shareholders' list close to 145mn shares of issued capital is with top 5 shareholders and therefore this stock is very illiquid too. Aided by this illiquidity and with another bit of increased aggression in business operations with a view to increase the interest yield would turnout this company to be an absolute profitable venture within a two to three years time similar to Union Bank.

Finally my conclusion is if an investor wants to participate to a future winning business and with an holding capacity of one to two years then Orient Finance will be an ideal investment vessel with lower risk threshold. Holding 5000 to 10000 shares will not be in vain for a mid term investor.

Thanks

Is it good time to collect BFN at this price EC ? Please advice

16 Re: Orient Finance PLC- possible future star on Wed Oct 19, 2016 11:10 am

EquityChamp

avatar
Moderator
Yes I think. Good price to do your investment.

17 Re: Orient Finance PLC- possible future star on Wed Oct 19, 2016 11:56 am

visvajith


Equity Analytic
Equity Analytic
@EquityChamp wrote:Yes I think. Good price to do your investment.

Thank You Very much Dear Friend 
Smile

18 Re: Orient Finance PLC- possible future star on Thu Oct 20, 2016 11:22 pm

sisira.wijeweera


Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics
@Teller wrote:See their loan booke growth. It's an amazing growth.  So we can hope a good interest income for them.
IF they can break 17/ barrier , this share will touch 20 levels.
tomorow BFN can be collect 14 level

19 Re: Orient Finance PLC- possible future star on Wed Apr 11, 2018 6:29 pm

EquityChamp

avatar
Moderator
Anyway finally BFN has moved past 20/-. This was by speculation. Anyway one or the other the price has moved.

20 Re: Orient Finance PLC- possible future star on Sat Apr 14, 2018 12:49 pm

Uaecoindubai


Equity Analytic
Equity Analytic
Hi teller:)

21 Re: Orient Finance PLC- possible future star on Thu Apr 19, 2018 2:18 pm

DS Wijesinghe


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
@EquityChamp wrote:Anyway finally BFN has moved past 20/-. This was by speculation. Anyway one or the other the price has moved.
It was a very clear organised manipulated move by the main shareholders. Our friend Maharaja too was an active member of that group.

BG Investments who had purchased BFN @ 15/- at the IPO would have wanted to exit. With absolutely very little market demand for BFN, Janashakthi PLC/Schaffter family controlled Dunamis and First Capital would have agreed to partly buy at a price closer to 15/- or slightly higher. Hence manipulate and move the price up and the rest of BG Investments shareholding would have been picked by other SPECULATING investors who thought " BFN PRICE IS MOVING UP AND THERE MUST BE SOMETHING REALLY GOOD HAPPENING AT THE COMPANY" even though profits have declined by (127%) by Sep 2017. Profits went further down to(163%) after the share price moved up










ShareholderNo. of Shares Dec 2017Shareholding Movement No. of Shares Sep 2017
Janashakthi PLC132,940,720-132,940,720
BG Investments0(4,567,594)4,567,594
Dunamis3,210,043826,1812,383,862
First Capital1,706,792281,7491,425,043
All Others10,160,8153,459,6646,701,151
Total148,018,370148,018,370

22 Re: Orient Finance PLC- possible future star on Thu Apr 19, 2018 6:54 pm

EquityChamp

avatar
Moderator
Good observations DS. The market roumer was spread that JINS is going to sell the company.

23 Re: Orient Finance PLC- possible future star on Thu Apr 19, 2018 10:29 pm

DS Wijesinghe


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
@EquityChamp wrote:Good observations DS. The market roumer was spread that JINS is going to sell the company.
Thanks EC. 

Unless one has reliable information to make BUY or SELL orders and Speculate for short term trading profits, investors should keep their investment decisions away from market rumours as much as possible.

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